The financial regulator has ordered a formal investigation by an independent
expert into allegations that Royal Bank of Scotland systematically defrauded
small business customers in distress.

A City accountancy or law firm will be appointed to lead a so-called Section
166 review of RBS’s treatment of companies that enter its restructuring
division.

The investigation has been triggered by a report by Lawrence Tomlinson, an
adviser to Vince Cable, the Business Secretary, that RBS forced viable
companies into restructuring, increasing fees and in many cases compelling
them to sell property to the bank’s own land bank at knock-down prices.